Loading...
01/11 18:30
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary indicates several negative factors: lowered revenue and EPS guidance, significant declines in revenue and EBITDA, and reduced share repurchases. The Q&A further highlights uncertainties, such as the impact of hurricanes and reluctance to provide specific guidance. Despite some positive elements like new deals and Project Core, the overall sentiment is negative, especially considering the lowered guidance and operational challenges. Given the company's market cap and the negative sentiment, the stock price is likely to fall by 2% to 8% over the next two weeks.
Total Revenue $1.8 billion, down about 11% year-over-year, primarily driven by lower sales in Office Depot and ODP Business Solutions, as well as 53 fewer stores in service compared to last year.
GAAP Operating Income $102 million, compared to $108 million in the prior year period, impacted by $61 million of credits and $9 million in expenses related to restructuring and asset impairment.
Adjusted Operating Income $41 million, down from $112 million in last year’s third quarter, reflecting lower sales and operational challenges.
Adjusted EBITDA $62 million, compared to $138 million in last year’s third quarter, due to lower revenues and operational challenges.
Adjusted Net Income $24 million or $0.71 per diluted share, compared to $85 million or $2.17 per diluted share in the prior year period, reflecting lower sales and operational performance.
Operating Cash Flow $81 million, down from $120 million in the same period last year, primarily due to lower sales and timing related to working capital.
Capital Expenditures $22 million, compared to $20 million in the prior year period, reflecting growth investments in the company's core operations.
Adjusted Free Cash Flow $68 million, compared to $102 million last year, primarily due to lower sales.
Veyer Third-Party Revenue Over $14 million, approximately a 30% increase over last year, driven by new customer contracts.
Total Liquidity $728 million, consisting of $192 million in cash and $536 million of available credit.
Total Debt $246 million.
Share Repurchases Just over $100 million in Q3 and a total of $295 million year-to-date.
New B2B Contract: ODP announced a key new business win representing one of its largest B2B contracts in company history, worth up to $1.5 billion over a 10-year period.
Market Expansion in Hospitality: ODP is actively pursuing opportunities in the hospitality industry, which is a large and growing market segment.
Veyer Revenue Growth: Veyer reported a 30% increase in external revenue over last year, driven by new third-party customers.
Sale of Varis Division: The sale of the Varis Division simplifies ODP's business structure and reduces future capital commitments.
B2B Pivot: ODP is accelerating its pivot to B2B, leveraging its supply chain and customer base to drive sustainable growth.
Investment Strategy: ODP is prioritizing investments in core B2B resources to capture larger opportunities and drive top-line growth.
Macroeconomic Conditions: Weak macroeconomic conditions impacted demand in both B2C and B2B channels, particularly during a competitive back-to-school season.
Natural Disasters: Major hurricanes negatively affected customer activity and operations in key service areas, causing temporary store closures.
Competitive Pressures: Intense competition during the back-to-school season led to lower consumer traffic and demand.
Consumer Spending Priorities: Changes in consumer spending priorities due to rising energy and food costs reduced demand across various categories.
Supply Chain Challenges: Disruptions in supply chain operations due to hurricanes and lower volumes from internal customers affected performance.
Enterprise Spending Constraints: Corporate layoffs and tight budgets restricted enterprise-level spending, impacting the B2B segment.
Store Footprint Optimization: The company is evaluating its store footprint strategy to optimize the retail business amidst declining sales.
Financial Performance: Overall performance was below expectations, with significant declines in revenue and adjusted EBITDA.
Investment Strategy: The company plans to reduce share repurchases to redirect capital into core B2B resources for growth.
B2B Pivot Progress: Significant progress on the strategic B2B pivot, securing key contracts and expanding influence in high-value industry sectors.
New Business Win: Announced a key new business win worth up to $1.5 billion over a 10-year period, marking one of the largest contracts in company history.
Investment in B2B Resources: Accelerating investment in core B2B resources to capture larger opportunities and drive top-line growth.
Veyer Growth: Veyer is executing its growth strategy, attracting new third-party customers and driving revenue increases.
Streamlining Operations: Completed the sale of the Varis Division to simplify business structure and reduce future capital commitments.
Focus on Hospitality Industry: Targeting growth in the hospitality industry as a promising adjacent market segment.
2024 Revenue Guidance: Maintaining revenue guidance at approximately $7 billion for 2024.
Adjusted EBITDA Outlook: Lowering adjusted EBITDA outlook to a range of $260 million to $300 million.
Adjusted Operating Income: Lowering adjusted operating income to a range of $160 million to $200 million.
Adjusted EPS Guidance: Lowering adjusted earnings per share to a range of $3.10 to $3.80.
Suspension of Free Cash Flow Guidance: Suspending guidance for adjusted free cash flow as investments are made in growth opportunities.
Share Repurchase Program: In the third quarter, ODP Corporation repurchased just over $100 million of its stock, totaling $295 million for the year-to-date. However, moving forward, the company expects to substantially reduce the pace of share repurchases as it redirects investment into core B2B resources to capture growth opportunities.
The earnings call summary shows mixed signals: strong cash flow and new contracts are positive, but retail revenue and store sales are declining. The Q&A reveals optimism in new deals and operational strategies, but management avoided specifics on growth timelines and strategic alternatives. The lack of guidance due to market dynamics and tariff concerns further contributes to uncertainty. With a market cap of approximately $1.42 billion, the stock is likely to have a neutral reaction, falling between -2% and 2%.
The earnings call reveals a mixed performance with a 9% revenue decline and a drop in adjusted EBITDA. Despite improvements in free cash flow and liquidity, the company faces challenges in onboarding new contracts and declining B2B revenue. Market sentiment may be further dampened by unclear guidance on stock buybacks and the impact of store closures. The market cap suggests moderate volatility, leading to a likely negative stock price reaction of -2% to -8% over the next two weeks.
The earnings call reveals a decline in financial metrics, including revenue, operating income, and net income, alongside reduced guidance for EBITDA and EPS. Despite some positive developments in B2B pivot and new partnerships, the suspension of free cash flow guidance and unclear management responses in the Q&A raise concerns. The market cap suggests moderate volatility, leading to a negative sentiment prediction of -2% to -8%.
The earnings call summary indicates several negative factors: lowered revenue and EPS guidance, significant declines in revenue and EBITDA, and reduced share repurchases. The Q&A further highlights uncertainties, such as the impact of hurricanes and reluctance to provide specific guidance. Despite some positive elements like new deals and Project Core, the overall sentiment is negative, especially considering the lowered guidance and operational challenges. Given the company's market cap and the negative sentiment, the stock price is likely to fall by 2% to 8% over the next two weeks.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
